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Chapter 1: What is the main topic discussed in this episode?
Breakfast Business with Enterprise Ireland on Newstalk. Good morning and welcome to Breakfast Business and thank you to Shane Beattie. It is Friday the 12th of December at 6.30. Happy International Soundcheck Day 1-2.
Coming up on today's show we'll be talking to Aon about the biggest global business risks out there and we'll be chatting to the ESRI with its latest outlook for Ireland's economy and all the scenarios about potential headwinds. And the markets as usual. You can email us business at Newstalk.com.
But first, let's have a look at those business stories in the newspapers and websites, which we shall do with the world famous economist. Well, at least in North County, Dublin, Austin Hughes. Good morning, Austin. Good morning, Joe. How are you? Bad luck against Crystal Palace yesterday. How was the weather in the Tala Stadium last night?
I'm surprised that Tala is on the Arctic Circle. It was very cold, very wet last night. And by the way, Ireland needs to spend an awful lot more on traffic infrastructure. Two hours from town to Tala just shouldn't happen on a Thursday night.
No, it shouldn't.
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Chapter 2: What are the biggest global business risks discussed in today's episode?
Of course, compounded by the green line being off as well, even though obviously Tala is on the red line for the Lewis, the green line being off, it compounded the issue and horrendous weather, as you say. Now, let's start with the inflation number out with the CSO yesterday, worryingly back over 3%.
Yeah, bad news on the inflation front. And it's been rising steadily, you know, through the second half of this year. It's still going to be just over 2% for the year, but we're at 3.2% in November. And I suppose the worrying thing, it picked up from 2.9% in October, and it's that there's a lot of small increases right across the board.
Nine out of the 12 main sort of areas that the CSO looks at showed higher inflation in November than October. So you have the standout sort of inflation, you know, beef prices up 23.9 percent, coffee 12.4 percent, all those sort of elements. But really right across you're seeing and significantly as we come into winter and cold nights like last night, energy prices now rising.
Remember, energy prices were down 7.7% this time last year. They're now up 3.3%. So people probably feel rightly that things are getting more expensive again. So not good news.
Indeed. I was reading through some of the commentary when the results came out yesterday. The farmers appear to have been the main beneficiaries from the rising prices and the supermarkets who are usually in the crosshairs for blame don't appear to be as much to blame as previous sessions.
Yeah, no, it's definitely the case. There's been a rebound in agricultural prices, not just in Ireland, but globally. And you're seeing that, as I say, in the meat prices and that poultry up seven and a half percent. Our fishermen also doing a little bit better, 4.7 percent there, butter 10.2 percent. So, yes, the farmers doing a little bit better after a couple of bad years previously.
But really, the story is of inflation creep right around the economy. Clothing prices were down 7.5% a year ago. They're up 4.4% this year. So looking a little bit better for Christmas is going to be more expensive as well.
And of course, if inflation prices continue to rise across the Eurozone, then the next move from the European Central Bank is almost certainly going to be to raise rates.
Yeah, it looks like the days of falling interest rates are behind us, you know, unless we see some very severe downturn in the economy at the moment. But the noises coming from Frankfurt are increasingly saying things, rate cuts have ended and we won't be raising rates quite yet. But mindful of what happened back in 2022, They're probably saying we probably will raise rates reasonably early.
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Chapter 3: How is inflation impacting the economy in Ireland?
Now, the way the Irish Times story suggests is that this is down to the lobbyists. But if you think about the government's situation, not to actually support or to oppose the EU measures in this regard would have risked killing the golden goose that keeps the public finances rolling in so healthy. And in that regard, it may not be the lobbyists.
It may be just a very acute awareness on the part of government that really the health of the pharma industry is the health of the Irish economy. So in that sense, it probably was common sense rather than persuasive powers of lobbyists that resulted in this outcome.
Indeed, and we will talk about that over-dependence on certain sectors in the Irish economy with the ESRI a little bit later. Austin, I hope you have a lovely weekend. Hopefully the weather will clear up a tiny bit. Have you got all your Christmas shopping done, by the way?
All done. They're trying to support the Irish economy as early as possible now, so hopefully we can... Of course, like everyone else, I'll discover Christmas Eve that there's somebody really important I've forgotten, but that's the joy of Christmas.
I presume you've sorted out my present, Austin.
That was first on the list. And sorry, I mean, I checked with Santa. You know, there's a few issues around the naughty element this year, Joe. But we'll talk about that another time.
I'm going to get off that naughty list somehow. Anyway, look after yourself, Austin. Have a great weekend. That is the renowned economist, Austin Hughes.
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